What Happened?
Shares of online community and discussion platform Reddit (NYSE: RDDT) jumped 3% in the morning session after investors continued to focus on the company's strong user growth and its valuable position in the artificial intelligence data market.
This move came as the company's stock had already surged significantly over the previous six months. The positive sentiment was tied to Reddit's transformation into a key source of human-generated data for training AI models. The company secured data-sharing deals with Alphabet's Google and OpenAI, which integrated Reddit's content into their platforms. This strategy to monetize its vast collection of authentic human conversations complemented its strong core advertising business. The advertising segment benefited from rising user engagement, with the company reporting in the third quarter of 2025 that both its daily and weekly active users increased 20% year over year.
After the initial pop the shares cooled down to $231.89, up 4% from previous close.
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What Is The Market Telling Us
Reddit’s shares are extremely volatile and have had 64 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 11 days ago when the stock gained 4.9% on the news that renewed enthusiasm for Alphabet reinvigorated the artificial intelligence trade, propelling a market rebound heading into the Thanksgiving holiday. The Nasdaq index jumped 2.6% and the S&P 500 gained 1.6%, driven by a 5% rally in Alphabet following the announcement of its upgraded Gemini 3 AI model. This optimism spilled over into the broader tech sector. The rally built on momentum from the previous trading session, sparked by the New York Fed president keeping the door open for a December interest rate cut.
Reddit is up 39.8% since the beginning of the year, but at $231.89 per share, it is still trading 14.3% below its 52-week high of $270.71 from September 2025. Investors who bought $1,000 worth of Reddit’s shares at the IPO in March 2024 would now be looking at an investment worth $4,597.
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